Deborah Morris, the CFPB’s deputy enforcement director, estimated about 1.5 million consumers paid at least $459 million just for identity protection products.
The joint-agency enforcement action also alleges the bank used deceptive marketing tactics when selling a payment protection product meant to cancel the customer’s debt if they experienced an involuntary hardship.
Check out the gory rip-’em-off details from Cordray himself – seriously, you can’t make this stuff up:
“For example, one (telemarketer) script we reviewed stated that with ‘Credit Protection Plus,’ Bank of America would cancel up to 18 months of the consumer’s minimum balance if the consumer was admitted to the hospital for as little as one night,” Cordray said. “In reality, a single night’s hospital stay would only entitle consumers, who successfully navigated Bank of America’s claims process, to one month of benefits – not the 18 months claimed in the scripts.”
All in all, the shady marketing and billing business – heck, let’s call the outright fraud the bank screwed its customers with – resulted in a consent order making them pony up $727 million (BofA calculates it at $738 million) in customer restitution and $45 million in fines and penalties.
Restitution is great, but a $45 million penalty? For fraud?
Seriously, if anyone else but a big bank, a big protected bank, had committed this kind of fraud, someone would be going to jail.
What drives me to my Alka-Seltzer and other relief concoctions is the headache and heartache I get when no one who is responsible for these fraud schemes goes to jail.
It’s a bank; there are lines of authority, of management, of orders, and an order trail. Who planned on not delivering the services? Who said we’ll just take their money? Someone, really several people, had to plan this. Offering services that aren’t delivered just doesn’t “happen” by itself.
Okay, that’s a long discussion. But we both know the Too Big to Fail banks are criminal enterprises – protected criminal enterprises.